Feb 16, 2006 - SAN FRANCISCO (Reuters) - Washington state's Senate has given a major boost to Gov. Christine Gregoire's plan to put aside $905 million in state revenues with a proposal for placing even more money in reserve, a spokeswoman said on Thursday.

The Democratic-controlled chamber endorsed on Wednesday a supplemental budget plan for the state's current two-year budget that sets aside $950 million in reserve for later use.

The state Senate's supplemental budget followed Gregoire, a Democrat, earlier this week urging lawmakers to avoid moves to boost spending or cut taxes aggressively because she is adamant about building the state's reserves.

Sen. Margarita Prentice, chair of the Senate Ways and Means Committee, said senators agreed to the $950 million reserve plan in case state revenues plateau later this year.

"We want to make sure we have plenty to go on," she said.

Washington's Democrat-led House is working on its supplemental budget plan, scheduled to be released next week, and its members are broadly in agreement with Gregoire's reserve target, said Rep. Helen Sommers, chair of the House Appropriations Committee.

Gregoire unveiled her supplemental budget plan in December, proposing the state set aside $905 million of a surplus then estimated at $1.4 billion.

The money would be held in an unrestricted reserve account to cover education costs and rising health-care costs in Washington's next two-year state budget cycle.

The state Senate's supplemental budget came on the heels of Washington's latest revenue forecast released on Wednesday.

Citing continued strength in construction and real estate activity in the fourth quarter, the forecast projected the state will collect $107.3 million more in revenue than anticipated in November.

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